John Kumah wants law on crowdfunding passed

The Member of Parliament for Ejisu in the Ashanti Region, John Ampontuah Kumah is urging Parliament to establish a legal framework for crowdfunding in order to support companies seeking capital for expansion.

Presenting a statement in Parliament on “Youth Unemployment and Job Creation through the Private Sector,” Mr. Kumah who is the immediate past CEO of the National Entrepreneurship and Innovation Programme (NEIP) maintained that government must endeavour to create more jobs as well as establish the appropriate environment for businesses to flourish.

He argued that, to achieve this, the country must chart a new path on job creation in Ghana built on the back of the private sector.

One of the means to achieve that is through crowdfunding. In simple terms crowdfunding is when businesses or individuals raise funds from a large number of people to finance a new business venture or to expand operations. In some instances, individuals get to owe equity in the business they invest in, he noted.

Furthermore, he explained that crowdfunding is an advanced form of the very good old “Susu” we know. “As individuals from one community, we sometimes join our resources to start a business. However, this time around thanks to technology, we benefit from the generosity and goodwill of people we don’t even know”.

“I am of the view that we as a country must do more to create an enabling environment for our entrepreneurs to get easy access to funds to fund their businesses.

Presently, there is no law in Ghana backing crowdfunding. The absence of this means that the private sector is handicapped when it comes to looking for financial investment,” Mr. Kumah added.

He called on Parliament to impress upon the Securities and Exchange Commission (SEC), which is working on a framework to regulate crowdfunding in the country, to submit the framework to Parliament.

AfCFTA approach

Another way to reduce unemployment, he says is to tap into the 1.3 billion consumer market presented by the African Continental Free Trade Area (AfCFTA).

“What the AfCFTA does that most small business owners know very little about is it allows them to export their products and services to other parts of the continent where they can generate more revenue which will help in expanding their businesses and subsequently contribute to creating more jobs.

With the coming into force of this compact, I entreat small business owners to consider venturing into other parts of the continent. We must seize the numerous benefits of AfCFTA,” he said